Abstract/Summary

This study explores the relationship between institutional entrepreneurship and legitimacy. It looks at how an institutional entrepreneur is able to acquire legitimacy for a novel innovation. The empirical setting is in an emerging economy, because institutions are typically less rigid in emerging economies, and so the likelihood of institutional entrepreneurship occurring is greater, providing more opportunities for experimental observation. While institutional theorists have devoted considerable attention to institutional entrepreneurship in recent years, there has been little focus on exploring the difference between the institutional entrepreneur’s actual creative act and the subsequent need for the entrepreneur to acquire legitimacy for her/his innovation. This study is the first to separate these two components of institutional entrepreneurship. By doing so, the study is then able to investigate three related questions: (1) Is it possible to shed new light on resolving the paradox of embedded agency?, (2) What are the mechanisms of legitimacy acquisition that an institutional entrepreneur uses to get her/his novel idea accepted and approved by the internal and external stakeholders?, and (3) What kind of institutional or ideological preconditions might be necessary for institutional entrepreneurial action to benefit or harm a society in an emerging economy? The study uses a qualitative case study design research based on systematic combining approach for data collection and analysis. The critical case study is the establishment of the first free trade zone in Dubai, UAE, the Jebel Ali Free Zone (JAFZA). Data was collected from 18 semi-structured interviews and several secondary resources detailing the establishment of JAFZA; and analyzed using thematic analysis to explain how the institutional innovation of JAFZA was received and accepted in a society. JAFZA has subsequently gone on to become the core business of the hugely successful DP World group.